The California economy was supposed to benefit from 2.8 million new jobs by 2020. The state was also supposed to gain $220 billion in additional income and $24 billion in additional tax revenues in that year alone, according to a study from the University of Southern California that relied heavily on industry funding.

But that was before the revelation by the Times that the EIA will reduce its estimate of technically recoverable oil in California's Monterey Shale by 96 percent--almost a complete wipeout--after taking a close look at actual data for wells drilled there already. The agency now believes that only about 600 million barrels are recoverable using existing technology. The 600 million barrels still sound like a lot, but those barrels would last the United States all of 40 days at the current rate of consumption.

Americans had been counting on the seemingly oil-rich Monterey Shale for more than 60 percent of a supposed newfound bounty of domestic oil locked up in deep shale deposits. But it turns out that the Monterey is rich with oil in the same way that seawater is rich in dissolved gold. In both cases the resource is there, but no one can figure out how get it out at a profit. The EIA previously estimated that resources of so-called tight oil, the proper name for oil from deep shale deposits, could reach 23.9 billion barrels for the United States as a whole. Overnight that number shrank to 9.1 billion.

The firm assumed, apparently without any justification, that the Monterey Shale would be just as productive as other shale deposits such as the Bakken in North Dakota and the Eagle Ford in Texas.

But the geology of the Monterey is riddled with folds and far more complex than other U.S. shale deposits, something that wouldn't have been too hard to find out from existing geological studies and well logs.

We cannot be sure whether those who wrote the wildly overoptimistic INTEK report were eager to encourage drilling and investment in the Monterey, something the oil industry certainly favored. But the colossal miss suggests the possibility that INTEK and its analysts have grown too close to the industry and are serving it rather than the EIA which commissioned the report.

It's no surprise that those who work in the oil industry are perennially optimistic. This high-risk business isn't for the timid. And that optimism is necessary if the industry is going to raise the capital it needs from investors. But it should be obvious that relying on the oil industry for objective information that will form the basis for public policy is a mistake. Independent sources and objective data are important cross-checks on the industry's understandable but often misleading enthusiasm.

The other explanation for the Monterey miss is that the analysts at INTEK are simply colossally inept. Note that INTEK was also responsible for the overall U.S. assessment of 23.9 billion barrels of technically recoverable oil lodged in deep shale formations. The California miss alone reduced estimated U.S. resources to 9.1 billion barrels, a cut which by itself calls into question the entire premise of renewed American oil abundance. But, the gargantuan misreading of the Monterey Shale's resources also suggests that the firm's estimates for other areas of the country need review as well.

A February 2013 comprehensive report on U.S. tight oil and natural gas from deep shales released by the Post Carbon Institute presaged the Monterey disappointment by pointing out how little oil had been extracted per well using advanced techniques in the Monterey Shale. A follow-on report issued in December focused exclusively on the Monterey and concluded that the INTEK/EIA estimate was vastly overblown. Not surprisingly, neither of these independent reports received any oil industry funding.

It is well to remember that the above numbers are all just estimates, and that they are for so-called technically recoverable resources. The estimates tell us little about how much oil from the Monterey or elsewhere might actually be economically recoverable, that is, profitably extracted. For that reason, the oil that is ultimately extracted from the Monterey and other deep shale deposits will likely be less than any estimate of technically recoverable resources. That means that even the 600 million barrel estimate for the Monterey may turn out to be too optimistic.

The industry counters that improved technology could change what seems unobtainable now into accessible oil. But, it cites no specific developments that are not already in use and therefore reflected in current estimates of what we can hope to extract. And the idea that we should base our public policy on innovations that no one has thought of yet seems more than a little unwise.

Moreover, while technology can improve, the laws of physics don't. The industry is already moving from the so-called "sweet spots" in shale deposits to those that are more difficult to exploit. That process will continue until the laws of physics and economics team up to make drilling unprofitable, and that will be the end of the shale boom in the rest of the country.

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P.S. In a previous piece I asked, "Will anyone who is currently predicting U.S. energy independence be punished if the story turns out to be wrong?" My answer was probably not. Now, we will find out if that turns out to be the case. My guess is that the oil industry will redouble its efforts to convince the public and policymakers to continue to believe something which cannot be supported by the evidence.

P.P.S. Tupper Hull, spokesman for the Western States Petroleum Association, told the San Francisco Chronicle the following in response to the Monterey Shale revision: "People forget that the boom taking place in Texas and particularly North Dakota did not happen overnight. There were decades of operators trying to understand the technology and the geology." He seems unable to recognize that in the decades that it may take to figure out how to unlock the Monterey Shale, California and the world will be working hard to create an advanced energy infrastructure that will make the Monterey irrelevant. Technology isn't standing still in renewable energy either.

Kurt Cobb is an author, speaker, and columnist focusing on energy and the environment. He is a regular contributor to the Energy Voices section of The Christian Science Monitor and author of the peak-oil-themed novel Prelude. In addition, he has written columns for the Paris-based science news site Scitizen, and his work has been featured on Energy Bulletin (now Resilience.org), The Oil Drum, OilPrice.com, Econ Matters, Peak Oil Review, 321energy, Common Dreams, Le Monde Diplomatique and many other sites. He maintains a blog called Resource Insights and can be contacted at kurtcobb2001@yahoo.com.

I am not so sure about renewables. Roger Andrews at Energy Matters points out that the white house solar system installed 2013 is only in the black with government subsidies. And Euan Mearns points out that the German energeiwende may not the success that was envisioned for it.

With regard to the future availability of renewable energy, I have always maintained the renewable energy is unlikely to replace the amount of energy we currently get from fossil fuels.

For that reason, I have advocated deep reductions in energy use which are possible with current technology and alterations of our behavior. This would pave the way for a society which could actually run on renewable energy. I am suggesting energy reductions on the order of 80 percent which I think are doable over 20 years if we make it a priority.

The problem of electricity storage, the form in which most renewable energy comes, is gradually being resolved. Will the renewable energy we have be cheap? Probably not. But if we are using 80 percent less, then cheap will be a relative matter, cheap relative to what level of usage.